GST's Rs 20-lakh threshold exemption means little

Big firms asking vendors to register even if exempted, to shift compliance burden

The exemption granted from registration under the goods and services tax (GST) system for entities with annual sales below Rs 20 lakh isn’t working for many of these, which supply to big companies.

For, the latter are, whatever the threshold, asking such entities to register and pay the tax. Also if the entity is registered even if its turnover is up to Rs 20 lakh, it may have to pay tax even for goods and services sold below this amount.

Any registered entity purchasing goods or services from unregistered dealers are allowed under the system to pay tax on these and then